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Dictionary by pitch.dog
Valuation methods & enterprise value · Core

Enterprise value

Also called: EV, company value

ELI5

Value attributed to operating assets for all capital providers, commonly derived from equity value plus net debt and adjustments.

Used in conversation

“The valuation memo needs to state the assumptions behind enterprise value.”

Pitch context

You will see “Enterprise value” in financial models, budgets, board packs and investor materials when the discussion reaches valuation methods & enterprise value.

Why it matters: In valuation methods & enterprise value, a loose definition can change rights, obligations, approval, disclosure or enforceability.

Caution

Meaning, enforceability and required process vary by jurisdiction and agreement; this definition is not legal advice.

Connected terms

  • Equity valueEnterprise value values the operating business across capital providers; equity value is the value attributable to equity holders.
  • Market capitalisationMarket capitalisation is public equity value; enterprise value adjusts equity value for defined debt, cash and other claims.
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Sources & evidence · 9

Direct term-level sources and supporting source families.